Archive for May, 2014

MEXICAN GOVERNMENT TO FUND RARE EARTH PROJECT

Sunday, May 25th, 2014

THE RARE EARTH FUNDING IN MEXICO BY GOVERNMENT

mexicos-government-to-fund-rare-earth-exploration image www.www-globalcommodities.com

Mexico’s Ministry of Economy will begin funding explorations projects to locate deposits of rare earth metals, a group of elements of increasing importance in variety of industries including green technology, defence systems, consumer electronics, and high-tech applications.

According to country’s Geological Survey (SGM), global demand for rare earths in 2016 will hit 160,000 tons, with China expected to produce up to 80% of that demand, which leaves room for other suppliers, The Economista reports (in Spanish).

The prediction coincides with the latest studies by the US National Academy of Science and the European Union, which have warned the world could soon face a serious shortage of the critical elements.

At the moment about 95% of the world’s rare earths come from the Asian giant, which also imposes export quotas.

Only two rare-earth mines currently exist in other countries. One of them is Lynas Corp’s (ASX:LYC) Mount Weld mine in Australia, and the other one in California, US, owned by Molycorp (NYSE:MCP).

Mexico, the world’s 10th-biggest crude producer, is in the midst of an ambitious programme of reforms proposed by the government last year. These aim to throw open the country’s energy sector for the first time in more than seven decades. They also seek generating cheap energy to fuel local industries.

The country’s mining industry employs about 334,000 directly, with 2 million people employed indirectly, making the sector the country’s fourth largest industry in dollar income, behind cars, oil and electronics.

The country’s mining industry employs about 334,000 directly, with 2 million people employed indirectly, making the sector the country’s fourth largest industry in dollar income, behind cars, oil and electronics.

While the amount of rare earth deposits Mexico may have it is not yet known, the country holds vast underwater reserves of these elements off its west coast. Deep-sea mining, however, is unlikely to replace land-based mining, believe experts, but they add it could alleviate the fear of shortages and challenge China’s virtual monopoly on REE production.

Henry Sapiecha

ANGLO AMERICA SHOWS SIGNS OF DUMPING ITS PLATINUM HOLDINGS & INTERESTS

Saturday, May 24th, 2014

AMPLATS INDICATES AN OFFLOADING OF ITS PLATINUM HOLDINGS

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Anglo American’s (LON:AAL) platinum unit, Amplats, is a step closer to selling its mines in South Africa as a now three-month strike over pay in the sector has forced the firm to dig into reserves, hitting its bottom line.

In an interview with Business Day, chief executive officer Mark Cutifani said the Rustenburg operations were no longer considered one of the company’s core assets.

I don’t think [our operations in South Africa’s platinum belt] is where our best skills set sits. That’s why I’ve been quite vocal saying we should consider taking a back step from Rustenburg,” he was quoted as saying.

While the region holds the world’s largest platinum deposits, the mines are labour-intensive and often deep, making mechanization costly and politically fraught, added Cutifani.

About 80,000 miners are on strike and have vowed not to return to the shafts until their minimum monthly wage is doubled to around $1,200.

platinum

Anglo has repeatedly said that demand, if met, would wreck its platinum subsidiary.

Earlier this month Sibanye Gold (NYSE:SBGL), the country’s top gold producer, said it was considering the acquisition of some platinum mines once the strike is resolved.

Amplats and the two other top world’s platinum producers Impala Platinum (JSE:IMP) and Lonmin (LON:LMI) said in joint statement the ongoing strike in the platinum belt was “unprecedented,” and at a stage where some of its impacts are becoming irreparable. To date, they have lost over a billion dollars in revenue.

Amplats is still producing about 60% of its platinum capacity from a few mines not affected by the strikes.

South Africa, Africa’s largest economy, holds about 80% of the world’s known platinum reserves, accounting for about 70% of global output, used for jewellery, catalytic converters in vehicles, and as a key source of hard currency for the country, among other applications.

Henry Sapiecha

WORLD PALLADIUM PRICES TO GO SKY HIGH SAY THE MINING EXPERTS

Saturday, May 24th, 2014

PALLADIUM PRICES HAVE NOWHERE TO GO EXCEPT UP SAY PUNTERS

auto-catalyst-platinum-photo image www.www-globalcommodities.comARROW CHART UP TP RIGHT BLUE IMAGE www.www-globalcommodities.com

South Africa and Russia combined account for close to 80% of global supply of palladium which is mainly used to clean emissions in automobiles.

More than 70,000 workers at the world’s three largest platinum and palladium producers, Anglo American Platinum (LON:AAL), Impala Platinumm (OTCMKTS:IMPUY) and Lonmin (LON:LMI), went on strike January 23.

In South Africa a judge of the country’s labour court ordered mine management and the militant Amcu labour union into three days of mediated talks on Thursday, seen as the best chance to end the bitter dispute.

According to a website set up by producers the companies’ have lost combined revenue of R18.8 billion (some $1.7 billion) while striking workers have lost more than $800 million in forfeited wages.

Roughly 10,000 ounces of platinum production and 5,000 ounces of palladium are lost each day the strike drags on. Even when strikers do return to work it would take up to three months to restart production.

At the same time Russia ordered its troops amassed on the border with Ukraine to withdraw to “create favourable conditions for Ukraine’s presidential vote and end speculations,” according to President Putin.

Near perfectly timed launch of South African palladium ETFs has boosted total holdings by 30% since April

 

A huge factor boosting the the palladium price has been the launch of two new physical palladium-backed exchange traded funds in Johannesburg in late March.

Ole Hansen, head of commodity strategy at Saxo Bank said in a squawk on Thursday the “near perfectly timed launch” of the ETFs by South African banks Absa and Standard has boosted total holdings by 30% since April to close to 85 tonnes or 3 million ounces.

Holdings in a platinum ETF listed a year ago on the Johannesburg Securities Exchange are also at record levels.

July platinum also strengthened on Thursday to $1,475 an ounce, up 7% in 2014.

Platinum production is nearly as concentrated as the of palladium with Russia and South Africa controlling more than 70% of global output, with North American producers a distant third.

Industry consultants Johnson Matthey Plc said yesterday platinum consumption will beat supply by 1.22 million ounces while the palladium shortfall will widen to 1.61 million ounces, from 371,000 ounces last year and the eighth year in a row of deficits.

Bloomberg reports that would constitute the largest market deficits ever, based on Johnson Matthey data going back to 1975 for platinum and 1980 for palladium:

“Supply-side issues are common to both platinum and palladium,” Peter Duncan, general manager, market research at Johnson Matthey, said yesterday. “We do expect auto demand to keep rising. In the medium term, this is mainly to do with emissions legislation in the case of platinum, and mainly growth in vehicle production in the case of palladium.”

A 17-week strike at South Africa’s PGM mines and a stand-off between the West and Russia have pushed the palladium price up nearly 16% this year.

The price of palladium hit fresh three-year highs on Wednesday, despite encouraging signs that labour action in South Africa may be nearing a conclusion and news that tensions on Ukraine’s border may be easing.

June palladium futures jumped 1% to $834.45 an ounce in New York, the highest level since March 2011, before easing slightly to $830.60 an ounce in afternoon trade. Palladium hit a record high of $865 in February 2011.

Henry Sapiecha

PRO-RUSSIAN SUPPORTERS SEIZE UKRAINE COAL MINES & DEMAND EXPLOSIVES

Saturday, May 24th, 2014

Pro-Russia separatists have seized four Ukrainian coal mines in the east of the conflict-torn country and demanded its workers to supply them with explosives, Hindustan Times reports.

ukraine-coal-miner image www.www-globalcommodities.com

The latest attack comes as the country prepares for a presidential election on Sunday that rebels have vowed to disrupt. It remains unclear how many protesters were involved or what happened to the miners.

Ukraine’s coal industry, one of the main engines of the nation’s economy, began attracting headlines last week, after an influential business magnate and mine-owner turned on the pro-Russia separatist movement.

Rinat Akhmetov, Ukraine’s richest man, on Monday criticized separatists for disrupting operations and pressed his employees to hold protests at their workplaces “until peace is established,” the BBC reported.

The mining magnate ended months of neutrality to protect his companies’ interests, which are concentrated in the industrial heartlands of east Ukraine. According to The New York Times, Akhmetov has been organizing his employees into patrols since Tuesday. He wanted them to take back the port city of Mariupol, being held by separatists.

pro-russia-rebels-seize-coal-mines-in-ukraine-demand-explosives photo www.www-globalcommodities.com

Pro-Russian separatists took over government buildings in April and declared independence after a referendum May 11 that was condemned by Kiev and Western nations. Ukrainians complain their country is being divided against their will and that they’re unable to publicly express their support for unified nation.

Henry Sapiecha

SHALE OIL DISCOVERED IN SOUTH OF ENGLAND BY THE BILLIONS OF BARRELS

Saturday, May 24th, 2014

BILLIONS OF BARRELS OF SHALE OIL DISCOVERED IN THE SOUTH OF ENGLAND

billions-of-barrels-worth-of-shale-oil-found-in-southern-england image www.www-globalcommodities.com

About 4.4 billion barrels-worth of shale oil have been found in the ground beneath the south of England, according to a report published Friday by the British Geological Survey (BGS).

 

The study, commissioned by the Department for Energy and Climate Change and released this morning, says the huge oil reserves lie under the Weald Basin in Kent and parts of Sussex and Surrey.

 

How much of this is recoverable is not yet known — further drilling and testing of new wells will be needed to establish this, but the discovery is set to spark a new stage in the battle between environmentalists and energy firms over the controversial topic of fracking.

 

The discovery has already pushed British authorities to start mulling plans to ease rules on accessing shale oil and gas, including drilling without landowners’ permission

The discovery has already pushed British authorities to start mulling plans to ease rules on accessing shale oil and gas, including drilling without landowners’ permission, reports Reuters.

 

Under the new plans, energy firms will be allowed to dig 300 metres (1,000ft) down for shale gas and deep geothermal operations provided they notify local communities and give them a “voluntary community payment” for access to the land of US$34,000 per well.

 

Last year, the BGS published a study of the Bowland Shale in northern England, which, it said, contained about 1,300tn cubic feet of gas. Analyst say that even if only a tenth of that were extracted, it would be the equivalent of 40 years’ gas supply for the UK.

weald-basin map image www.www-globalcommodities.com

Henry Sapiecha

 

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